Indexes churned higher in afternoon trading after House Budget Committee Chairman
Paul Ryan
said Republicans are discussing whether to support a short-term increase in the debt ceiling.

"We've got a relief rally today, but this just pushes back the rancorous debate," said John Canally, investment strategist and economist with LPL Financial.

Earlier, the rally revved up as Japanese news outlet Nikkei reported the Bank of Japan is planning further action to stimulate the economy.

In the U.S., housing starts jumped in December more than economists had expected. Building permits also rose in December, mostly in line with expectations.

Consumer-discretionary stocks, which include home builders, led the S&P 500 higher.
Toll Brothers
rose $1.25, or 3.6%, to $36.16,
D.R. Horton
advanced 53 cents, or 2.5%, to 21.53, and
PulteGroup
gained 1.03, or 5.3%, to 20.37.

In other economic news, jobless claims fell more than expected in the latest week, and a reading indicated business conditions for mid-Atlantic manufacturers unexpectedly contracted. The Federal Reserve Bank of Philadelphia's regional manufacturing gauge for January fell, but the index measuring expectations for the next six months rose.

Bank shares in the S&P 500 posted the only sector decline Thursday.

"Financial shares had a pretty good year last year, and earnings expectations for this year and next are pretty mundane," said
Paul Atkinson,
head of North American equities for
Aberdeen Asset Management
,
which oversees $300 billion in assets.

Bank of America
lagged behind among blue chips, falling 50 cents, or 4.2%, to 11.28, after its profit tumbled. The bank reported declining revenue in its core consumer and business banking line, and missed expectations on some other metrics, though its earnings beat analyst expectations.

Citigroup
dropped 1.24, or 2.9%, to 41.24, after the company's earnings missed expectations.

In the Markets

European shares gained on the back of several strong earnings reports. The Stoxx Europe 600 index rose 0.5%. The U.K.'s FTSE 100 index rose 0.5% to its highest closing level since May 2008. France's CAC-40 index advanced 1% to its highest close since July 2011.

Crude-oil prices rose 1.3%, to settle at $95.49 a barrel, a four-month high, amid a hostage crisis at an Algerian oil field. Gold rose 0.5%, to settle at $1,690.40 a troy ounce. The dollar fell against the euro and jumped against the yen on the news of possible further easing. The yield on the 10-year Treasury note rose to 1.873% as prices fell.

In corporate news,
BlackRock
climbed 9.76, or 4.4%, to 232, after the asset manager's earnings beat estimates, and it recorded double-digit-percentage revenue growth, helped by higher assets under management.

CBS
surged 3.01, or 7.9%, to 40.95, after the broadcaster said it was taking further steps to divest itself of its outdoor-advertising business.

Fifth Third Bancorp
gained 74 cents, or 4.8%, to 16.29, after both earnings and revenue topped consensus forecasts.

PNC Financial Services Group
advanced 2.23, or 3.7%, to 62.01, after it beat analyst estimates on revenue, though it fell just short of earnings-per-share projections.

CVR Refining edged five cents higher, or 0.2%, to 25.05, as the master limited partnership, which owns pipelines and petroleum-refining assets, made its stock-market debut.

UnitedHealth Group
rose 74 cents, or 1.4%, to 54.40, after the biggest managed-care company by revenue beat expectations for revenue and earnings.

EBay
rose 1.27, or 2.4%, to 54.17, after the online retailer posted a drop in fourth-quarter profit late Wednesday but largely met expectations.

Williams-Sonoma
skidded 2.45, or 5.2%, to 44.68, after the retailer kept its outlook for its fiscal fourth-quarter earnings steady. Analysts had expected the company to move its projection a couple of cents higher.

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